Indicate by check mark whether the registrant (1) has filed all reportsrequired to be filed by Section 13 or 15(d) of the Securities Exchange Act of1934 during the preceding 12 months (or for such shorter period that theregistrant was required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days.

TYeso No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

TYeso No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

TBVPS and ROTCE are non-GAAP financial measures. TBVPS represents the Firm’s tangible common equity divided by period-end common shares. ROTCE measures the Firm’s annualized earnings as a percentage of tangible common equity. For further discussion of these measures, see Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures on pages 16–17 of this Form 10-Q.

(b)

Share price shown for JPMorgan Chase’s common stock is from the New York Stock Exchange. JPMorgan Chase’s common stock is also listed and traded on the London Stock Exchange and the Tokyo Stock Exchange.

(c)

Return on Basel risk-weighted assets is the annualized earnings of the Firm divided by its average risk-weighted assets (“RWA”).

(d)

Basel III rules became effective on January 1, 2014; all prior period data is based on Basel I rules. For further discussion, see Regulatory capital on pages 63–68 of this Form 10-Q.

(e)

HQLA is the estimated amount of assets that qualify for inclusion in the Basel III liquidity coverage ratio; see HQLA on page 74 of this Form 10-Q.

(f)

Included held-to-maturity (“HTM”) securities of $47.3 billion, $24.0 billion and $4.5 billion at March 31, 2014, December 31, 2013 and September 30, 2013, respectively. Held-to-maturity balances for the other periods were not material.

Excludes the impact of residential real estate purchased credit-impaired (“PCI”) loans. For further discussion, see Allowance for credit losses on pages 54–56 of this Form 10-Q.

3

INTRODUCTION

This section of the Form 10-Q provides management’s discussion and analysis (“MD&A”) of the financial condition and results of operations of JPMorgan Chase & Co. (“JPMorgan Chase” or the “Firm”). See the Glossary of terms on pages 169–172 for definitions of terms used throughout this Form 10-Q.

This 10-Q should be read in conjunction with JPMorgan Chase’s Annual Report 2013 on Form 10-K for the year ended December 31, 2013, filed with the U.S. Securities and Exchange Commission (“2013 Annual Report” or “2013 Form 10-K”), to which reference is hereby made.

The MD&A included in this Form 10-Q contains statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of JPMorgan Chase’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. For a discussion of those risks and uncertainties and the factors that could cause JPMorgan Chase’s actual results to differ materially from those risks and uncertainties, see Forward-looking Statements on page 79 of this Form 10-Q and Part I, Item 1A, Risk Factors, on pages 9–18 of JPMorgan Chase’s 2013 Annual Report.

JPMorgan Chase & Co., a financial holding company incorporated under Delaware law in 1968, is a leading global financial services firm and one of the largest banking institutions in the United States of America (“U.S.”), with operations worldwide; the Firm had $2.5 trillion in assets and $219.7 billion in stockholders’ equity as of March 31, 2014. The Firm is a leader in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing, asset management and private equity. Under the J.P. Morgan and Chase brands, the Firm serves millions of customers in the U.S. and many of the world’s most prominent corporate, institutional and government clients.

JPMorgan Chase’s principal bank subsidiaries are JPMorgan Chase Bank, National Association (“JPMorgan Chase Bank, N.A.”), a national bank with U.S. branches in 23 states, and Chase Bank USA, National Association (“Chase Bank USA, N.A.”), a national bank that is the Firm’s credit card–issuing bank. JPMorgan Chase’s principal nonbank subsidiary is J.P. Morgan Securities LLC (“JPMorgan Securities”), the Firm’s U.S. investment banking firm. The bank and nonbank subsidiaries of JPMorgan Chase operate nationally as well as through overseas branches and subsidiaries, representative offices and subsidiary foreign banks. One of the Firm’s principal operating subsidiaries in the United Kingdom (“U.K.”) is J.P. Morgan Securities plc , a subsidiary of JPMorgan Chase Bank, N.A.

JPMorgan Chase’s activities are organized, for management reporting purposes, into four major reportable business segments, as well as a Corporate/Private Equity segment. The Firm’s consumer business is the Consumer & Community Banking segment. The Corporate & Investment Bank, Commercial Banking, and Asset Management segments comprise the Firm’s wholesale businesses. A description of the Firm’s business segments, and the products and services they provide to their respective client bases, follows.

Consumer & Community Banking

Consumer & Community Banking (“CCB”) serves consumers and businesses through personal service at bank branches and through ATMs, online, mobile and telephone banking. CCB is organized into Consumer & Business Banking (“CBB”), Mortgage Banking (including Mortgage Production, Mortgage Servicing and Real Estate Portfolios) and Card, Merchant Services & Auto (“Card”). Consumer & Business Banking offers deposit and investment products and services to consumers, and lending, deposit, and cash management and payment solutions to small businesses. Mortgage Banking includes mortgage origination and servicing activities, as well as portfolios comprised of residential mortgages and home equity loans, including the purchased credit-impaired (“PCI”) portfolio acquired in the Washington Mutual transaction. Card issues credit cards to consumers and small businesses, provides payment services to corporate and public sector clients through its commercial card products, offers payment processing services to merchants, and provides auto and student loan services.

Corporate & Investment Bank

The Corporate & Investment Bank (“CIB”), comprised of Banking and Markets & Investor Services, offers a broad suite of investment banking, market-making, prime brokerage, and treasury and securities products and services to a global client base of corporations, investors, financial institutions, and government and municipal entities. Within Banking, the CIB offers a full range of investment banking products and services in all major capital markets, including advising on corporate strategy and structure, capital-raising in equity and debt markets, as well as loan origination and syndication. Also included in Banking is Treasury Services, which includes transaction services, comprised primarily of cash management and liquidity solutions, and trade finance products. The Markets & Investor Services segment of the CIB is a global market-maker in cash securities and derivative instruments, and also offers sophisticated risk management solutions, prime brokerage, and research. Markets & Investor Services also includes the Securities Services business, a leading global custodian, which includes custody, fund accounting and administration, and securities lending products sold principally to asset managers, insurance companies and public and private investment funds.

4

Commercial Banking

Commercial Banking (“CB”) delivers extensive industry knowledge, local expertise and dedicated service to U.S. and multinational clients, including corporations, municipalities, financial institutions and nonprofit entities with annual revenue generally ranging from $20 million to $2 billion. CB provides financing to real estate investors and owners. Partnering with the Firm’s other businesses, CB provides comprehensive financial solutions, including lending, treasury services, investment banking and asset management to meet its clients’ domestic and international financial needs.

Asset Management

Asset Management (“AM”), with client assets of $2.4 trillion as of March 31, 2014, is a global leader in investment and wealth management. AM clients include institutions, high-net-worth individuals and retail investors in every major market throughout the world. AM offers investment management across all major asset classes including equities, fixed income, alternatives and money market funds. AM also offers multi-asset investment management, providing solutions to a broad range of clients’ investment needs. For individual investors, AM also provides retirement products and services, brokerage and banking services including trusts and estates, loans, mortgages and deposits. The majority of AM’s client assets are in actively managed portfolios.

In addition to the four major reportable business segments outlined above, the following is a description of the Corporate/Private Equity segment.

Corporate/Private Equity

The Corporate/Private Equity segment comprises Private Equity, Treasury and Chief Investment Office (“CIO”) and Other Corporate, which includes corporate staff units and expense that is centrally managed. Treasury and CIO are predominantly responsible for measuring, monitoring, reporting and managing the Firm’s liquidity, funding and structural interest rate and foreign exchange risks, as well as executing the Firm’s capital plan. The major Other Corporate units include Real Estate, Enterprise Technology, Legal, Compliance, Finance, Human Resources, Internal Audit, Risk Management, Oversight & Control, Corporate Responsibility and various Other Corporate groups. Other centrally managed expense includes the Firm’s occupancy and pension-related expense that are subject to allocation to the businesses.

5

EXECUTIVE OVERVIEW

This executive overview of the MD&A highlights selected information and may not contain all of the information that is important to readers of this Form 10-Q. For a complete description of trends and uncertainties, as well as the risks

and critical accounting estimates affecting the Firm and its various lines of business, this Form 10-Q should be read in its entirety.

Financial performance of JPMorgan Chase

Three months ended March 31,

(in millions, except per share data and ratios)

2014

2013

Change

Selected income statement data

Total net revenue

$

22,993

$

25,122

(8

)%

Total noninterest expense

14,636

15,423

(5

)

Pre-provision profit

8,357

9,699

(14

)

Provision for credit losses

850

617

38

Net income

5,274

6,529

(19

)

Diluted earnings per share

1.28

1.59

(19

)

Return on common equity

10

%

13

%

Capital ratios(a)

Tier 1 capital

12.1

11.6

Tier 1 common(b)

10.9

10.2

(a)

Basel III rules became effective on January 1, 2014; all prior period data is based on Basel I rules. For further discussion of the implementation of Basel III, see Regulatory capital on pages 63–68 of this Form 10-Q.

(b)

The Tier 1 common capital ratio is common equity Tier 1 capital (“Tier 1 common”) divided by risk-weighted assets. Management, bank regulators, investors and analysts use Tier 1 common capital along with the other capital measures to assess and monitor the Firm’s capital position. Prior to Basel III becoming effective on January 1, 2014, Tier 1 common capital was a non-GAAP financial measure. For further discussion of Tier 1 common capital, see Regulatory Capital on pages 63–68 of this Form 10-Q.

Business Overview

JPMorgan Chase reported first-quarter 2014 net income of $5.3 billion, or $1.28 per share, on net revenue of $23.0 billion. Net income decreased by $1.3 billion, compared with net income of $6.5 billion, or $1.59 per share, in the first quarter of 2013. Return on equity for the quarter was 10%, compared with 13% for the prior-year quarter.

The decrease in net income from the first quarter of 2013 was driven by lower net revenue and higher provision for credit losses, partially offset by lower noninterest expense. Net revenue was $23.0 billion, down $2.1 billion, or 8%, compared with the prior year. Noninterest revenue was $12.3 billion, down $1.9 billion, or 13%, compared with the prior year, driven by lower mortgage fees and related income, and a decrease in securities gains. Net interest income was $10.7 billion, down 2% compared with the prior year, reflecting the impact of lower loan yields and lower average trading asset balances, predominantly offset by higher investment securities yields, lower long-term debt and deposit interest expense.

The current-quarter consumer provision reflected a $449 million reduction in the allowance for loan losses, compared with a $1.1 billion reduction in the prior year. The current-quarter consumer allowance release was primarily due to the impact of improved home prices and delinquency trends in the residential real estate portfolio, as well as a reduction in the credit card asset-specific allowance due to increased granularity of impairment estimates for loans modified in

troubled-debt restructurings (“TDRs”). Consumer net charge-offs were $1.3 billion, compared with $1.7 billion in the prior year, resulting in a net charge-off rate of 1.24%, compared with 1.65% in the prior year. The wholesale provision for credit losses was $43 million, compared with $72 million in the prior year. Wholesale net charge-offs were $13 million, compared with $35 million in the prior year, resulting in a net charge-off rate of 0.02%, compared with 0.05% in the prior year. The Firm’s allowance for loan losses to period-end loans retained, excluding PCI loans, was 1.75%, compared with 2.27% in the prior year. The Firm’s nonperforming assets totaled $9.5 billion, down from the prior-quarter and prior-year levels of $9.7 billion and $11.7 billion, respectively.

Noninterest expense was $14.6 billion, down $787 million, or 5%, compared with the prior year, primarily driven by lower performance-based compensation in CIB and lower mortgage production and servicing expense.

CBB average deposits were up 9%. Client investment assets were a record $195.7 billion, up 16%, and credit card sales volume was $104.5 billion, up 10% from the prior year. CIB maintained its #1 ranking for Global Investment Banking fees, and assets under custody were up 10% compared with the prior year. CB period-end loan balances were up 7%, and gross investment banking revenue with CB clients was up 31%. AM reported positive net long-term product flows for the twentieth consecutive quarter, total client assets of $2.4 trillion and record average loan balances of $95.7 billion.

6

The Firm maintained its fortress balance sheet, ending the first quarter with an estimated Basel III Advanced Fully Phased-in Tier 1 common capital of $156 billion and a Tier 1 common ratio of 9.6%. (The Basel III Advanced Fully Phased-in Tier 1 measures are non-GAAP financial measures, which the Firm uses, along with the other capital measures, to assess and monitor its capital position. For further discussion of the Tier 1 common capital ratios, see Regulatory capital on pages 63–68 of this Form 10-Q.) The Firm’s supplementary leverage ratio (“SLR”) was 5.1% and the Firm had $538 billion of high quality liquid assets (“HQLA”) as of March 31, 2014.

JPMorgan Chase continued to support clients, consumers, companies and communities around the globe. The Firm provided credit and raised capital of over $450 billion for commercial and consumer clients during the three months ended March 31, 2014. This included $5 billion of credit provided for U.S. small businesses and $138 billion of credit provided for corporations. This also included more than $253 billion of capital for clients and more than $12 billion of credit provided to, and capital raised for, nonprofit and government entities, including states, municipalities, hospitals and universities.

Consumer & Community Banking net income was $1.9 billion, a decrease of $650 million, or 25%, compared with the prior year, due to lower net revenue and higher provision for credit losses, partially offset by lower noninterest expense. Net revenue was $10.5 billion, a decrease of $1.2 billion, or 10%, compared with the prior year. Net interest income was $7.0 billion, down $183 million, or 3%, driven by spread compression in Credit Card, Auto and Consumer & Business Banking, and by lower mortgage warehouse balances, largely offset by higher deposit balances. Noninterest revenue was $3.4 billion, a decrease of $972 million, or 22%, driven by lower mortgage fees and related income. The provision for credit losses was $816 million, compared with $549 million in the prior year. The current-quarter provision reflected a $450 million reduction in the allowance for loan losses and total net charge-offs of $1.3 billion. The prior-year provision reflected a $1.2 billion reduction in the allowance for loan losses and total net charge-offs of $1.7 billion. Noninterest expense was $6.4 billion, a decrease of $353 million, or 5%, from the prior year, driven by lower Mortgage Banking expense. Return on equity for the first quarter of 2014 was 15% on $51.0 billion of average allocated capital.

Corporate & Investment Bank net income decreased compared with the prior year, reflecting lower revenue, partially offset by lower noninterest expense. Net revenue was $8.6 billion, down 15% from $10.1 billion in the prior year. Excluding the impact of a debit valuation adjustment (“DVA”) gain of $126 million in the prior year, net revenue was down 14% from $10.0 billion in the prior year, and net income was down 22% from $2.5 billion in the prior year. Noninterest expense decreased from the prior year, primarily driven by lower performance-based compensation. Return on equity for the first quarter of

2014 was 13% on $61.0 billion of average allocated capital.

Commercial Banking net income decreased compared with the prior year, reflecting an increase in noninterest expense, partially offset by a lower provision for credit losses. Net revenue was down 1% compared with the prior year. Net interest income decreased 4% compared with the prior year, reflecting spread compression and higher funding costs on loan products and lower purchase discounts recognized on loan repayments, partially offset by higher loan balances. Noninterest revenue increased by 4% compared with the prior year, driven by higher investment banking revenue. Noninterest expense increased by 7% compared with the prior year, reflecting higher control and headcount-related expense. Return on equity for the first quarter of 2014 was 17% on $14.0 billion of average allocated capital.

Asset Management net income decreased compared with the prior year, reflecting higher noninterest expense, largely offset by higher net revenue. Net revenue increased 5% from the prior year. Noninterest revenue was up 6% from the prior year, due to net client inflows and the effect of higher market levels, partially offset by lower valuations of seed capital investments. Net interest income was flat from the prior year, due to higher loan and deposit balances, predominantly offset by narrower loan spreads. Noninterest expense increased 11% from the prior year, primarily due to higher headcount-related expense and costs related to the control agenda. Return on equity was 20% on $9.0 billion of average allocated capital and pretax margin was 26% for the first quarter of 2014.

Corporate/Private Equity net income was $340 million, compared with net income of $250 million in the prior year.

Private Equity reported net income of $215 million, compared with a net loss of $182 million in the prior year. Net revenue was $363 million, compared with a loss of $276 million in the prior year, primarily due to net valuation gains on public and private investments and gains from sales.

Treasury and CIO reported a net loss of $94 million, compared with net income of $24 million in the prior year. Net revenue was $2 million, compared with $113 million in the prior year. Current-quarter net interest income was a loss of $87 million compared with a loss of $472 million in the prior year, reflecting the benefit of higher interest rates and reinvestment opportunities.

Other Corporate reported net income of $219 million, compared with $408 million in the prior year. The current quarter included an after-tax charge of approximately $90 million for the write-down of deferred tax assets following New York State tax law changes enacted on March 31, 2014. The prior year included an after-tax benefit of $227 million for tax adjustments.

7

2014 Business outlook

JPMorgan Chase’s outlook for the second quarter and remainder of 2014 should be viewed against the backdrop of the global and U.S. economies, including strength of consumers and businesses, U.S. housing prices, unemployment rate, implied market interest rates, financial market levels and activity, the geopolitical environment, the competitive environment, client activity levels, and regulatory and legislative developments in the U.S. and other countries where the Firm does business. Each of these linked factors will affect the performance of the Firm and its lines of business; however, each of these factors will affect, to a different degree, each of the lines of business.

Set forth below is a table summarizing management’s current expectations with respect to certain specific revenue, expense and credit items, as well as the related drivers, for the second quarter and the remainder of 2014.

These current expectations are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs and expectations of JPMorgan Chase’s management, are made only as of the date hereof, and are subject to significant risks and uncertainties. These risks and uncertainties could cause the Firm’s actual results to differ materially from those set forth in such forward-looking statements. See Forward-Looking Statements on page 79 of this Form 10-Q and Risk Factors on page 64 of JPMorgan Chase's 2013 Annual Report. There is no assurance that actual results for the second quarter or full year of 2014 will be in line with the outlook set forth below, and the Firm does not undertake to update any of these forward-looking statements to reflect the impact of circumstances or events that arise after the date hereof.

Selected outlook items

(in millions, unless otherwise noted)

LOB

Sub-LOB

Line item

FY13

1Q14

Current management outlook

Firmwide

—

Core net interest margin (%)

2.66

%

2.66

%

Expect core net interest margin relatively stable in 2014

Firmwide

—

Adjusted expense

($ in billions)(a)

$

59.0

$

14.6

Expect firmwide adjusted expense below $59 billion for FY14. The final firmwide expense will be affected by performance-related compensation for the full year

Expect CCB, excluding MB, expense to increase by approximately $120 million in 2Q14, primarily driven by the timing of marketing campaigns. Expect CCB, excluding MB, expense to increase by approximately 1% for FY14 versus FY13, in-line with previous guidance

Expect quarterly expense to be relatively flat for CB and to increase modestly for AM, compared to 1Q14, for the remainder of the year, due to continued investment in controls and growth

Higher levels of mortgage interest rates are expected to continue to have a negative impact on volumes. Expect pretax production loss of approximately $100–$150 million in 2Q14 and pretax margins to be negative in 2H14

CCB

MB

Servicing-related net

revenue(b)

$

2,869

$

713

Expect net servicing revenue(b) of $600–$650 million in 2Q14 and declining by approximately 10% (not annualized) per quarter for 2H14

CCB

MB

Servicing and default expense

$

2,973

$

582

Expect servicing and default expense to be relatively flat in 2Q14 and to trend down slightly in 2H14

CCB

MB

Reduction in NCI Real Estate Portfolios allowance for loan losses

$

(2,300

)

$

(200

)

If delinquencies continue to trend down and the macro-economic environment remains stable or improves, potential for further modest reductions in the allowance for loan losses over time

CCB

Card

Reduction in Card allowance for loan losses

$

(1,706

)

$

(204

)

Based on the current credit environment, do not expect any significant reductions in the Card allowance for loan losses

CIB

Fixed Income & Equities

Revenue

$

20,226

$

5,055

Based on Markets revenue results to date, which reflect a continued challenging environment and lower client activity levels, expect 2Q14 Markets revenue to be down approximately 20%+/- versus 2Q13. The Markets revenue actual results will depend heavily on performance throughout the remainder of the quarter, which can be volatile

CIB

Securities Services

Revenue

$

4,082

$

1,011

Expect Securities Services revenue to increase in 2Q14 by approximately $100 million compared to 1Q14, primarily due to seasonality

CIB

Treasury Services (“TS”)

Revenue

$

4,135

$

1,009

Expect TS revenue to be flat versus 1Q14, at approximately $1 billion for the remainder of 2014, primarily due to the impact of business simplification and lower trade finance activity and spreads

This line item is net of changes in the MSR asset fair value due to collection/realization of expected cash flows; plus net interest income.

Note: The table above includes abbreviations to denote the following: for the twelve months ended December 31, 2014 (“FY14”); for the twelve months ended December 31, 2013 (“FY13”); for the six months ended December 31, 2014 (“2H14”); for the three months ended June 30, 2014 (“2Q14”); for the three months ended June 30, 2013 (“2Q13”); for the three months ended March 31, 2014 (“1Q14”); line of business (“LOB”); and Non credit-impaired ("NCI").

8

Business events

Regulatory Update

Comprehensive Capital Analysis and Review (“CCAR”)

On March 26, 2014, the Federal Reserve informed the Firm that it did not object, on either a quantitative or qualitative basis, to the Firm’s 2014 capital plan.

Basel III

Effective January 1, 2014, the Firm became subject to Basel III. Prior to January 1, 2014, the Firm and its banking subsidiaries were subject to the capital requirements of Basel I and Basel 2.5.

For further information on CCAR and the implementation of Basel III, refer to Capital management on pages 63–70 of this Form 10-Q.

Preferred stock issuances

On January 22, 2014, the Firm issued $2.0 billion of Fixed-to-Floating Rate Non-Cumulative Preferred Stock with an optional redemption date on or after February 1, 2024; dividends are payable semiannually at a fixed rate of 6.75% through February 2024, and thereafter at a rate of three-month LIBOR plus 3.78%. On January 30, and February 6, 2014, the Firm issued a combined total of $925 million of Fixed Rate Non-Cumulative Preferred stock with an optional redemption date on or after March 1, 2019; dividends are payable quarterly at a fixed rate of 6.70%. Lastly, on March 10, 2014, the Firm issued $1.0 billion of Fixed-to-Floating Rate Non-Cumulative Preferred Stock with an optional redemption date on or after April 30, 2024; dividends are payable semiannually at a fixed rate of 6.125% through April 2024, and thereafter at a rate of three-month LIBOR plus 3.33%. Preferred stock dividends declared during the three months ended March 31, 2014 were $227 million; assuming all issuances described above were outstanding during the entire quarter and quarterly dividends were declared on such issuances, preferred stock dividends would have been $254 million for the quarter. For further information on the Firm’s preferred stock, see Note 22 on page 309 of JPMorgan Chase’s 2013 Annual Report.

Physical commodities businesses

The Firm continues to execute a business simplification agenda that will allow it to focus on core activities for its core clients and better manage its operational, regulatory, and litigation risks. On March 19, 2014, the Firm announced that it had agreed to sell certain of its physical commodities operations, including its physical oil, gas, power, warehousing facilities and energy transportation operations, to Mercuria Energy Group Limited for approximately $3.5 billion. The after-tax impact of this transaction is not expected to be material. The sale is subject to normal regulatory approvals and is expected to close in the third quarter of 2014. The Firm remains fully committed to its traditional banking activities in the commodities markets, including financial derivatives and the trading of precious metals, which are not part of the physical commodities operations sale.

Common stock dividend increase and common equity repurchases

On March 26, 2014, the Firm announced, following the Federal Reserve Board’s release of the 2014 CCAR results, its Board of Directors intends to increase the quarterly common stock dividend to $0.40 per share, effective the second quarter of 2014. The Firm’s dividends will be subject to the Board of Directors’ approval at the customary times those dividends are declared. The Board has also authorized a common equity repurchase program to repurchase $6.5 billion of common equity between April 1, 2014, and March 31, 2015. This authorization includes shares repurchased to offset issuances under the Firm’s equity-based compensation plans.

9

CONSOLIDATED RESULTS OF OPERATIONS

The following section provides a comparative discussion of JPMorgan Chase’s Consolidated Results of Operations on a reported basis for the three months ended March 31, 2014 and 2013. Factors that relate primarily to a single business segment are discussed in more detail within that business segment. For a discussion of the Critical Accounting Estimates Used by the Firm that affect the Consolidated Results of Operations, see pages 76–78 of this Form 10-Q and pages 174–178 of JPMorgan Chase’s 2013 Annual Report.

Revenue

Three months ended March 31,

(in millions)

2014

2013

Change

Investment banking fees

$

1,420

$

1,445

(2

)%

Principal transactions

3,322

3,761

(12

)

Lending- and deposit-related fees

1,405

1,468

(4

)

Asset management, administration and commissions

3,836

3,599

7

Securities gains

30

509

(94

)

Mortgage fees and related income

514

1,452

(65

)

Card income

1,408

1,419

(1

)

Other income(a)

391

536

(27

)

Noninterest revenue

12,326

14,189

(13

)

Net interest income

10,667

10,933

(2

)

Total net revenue

$

22,993

$

25,122

(8

)%

(a)

Included operating lease income of $398 million and $349 million for the three months ended March 31, 2014 and 2013, respectively.

Total net revenue for the three months ended March 31, 2014, was $23.0 billion, a decrease of $2.1 billion, or 8%, compared with the three months ended March 31, 2013. The decrease from the prior year was driven by lower mortgage fees and related income, securities gains, and principal transactions revenue.

Investment banking fees decreased compared with the three months ended March 31, 2013, reflecting lower debt underwriting fees, partly offset by higher advisory and equity underwriting fees. The decrease in debt underwriting fees was driven by lower industry-wide volumes of high-yield bond underwriting and loan syndications. Higher advisory fees were driven by an increase in the Firm’s wallet share, and the increase in equity underwriting fees was due to higher industry-wide issuances. For additional information on investment banking fees, see CIB segment results pages 28–31 and Note 6 on page 110 of this Form 10-Q.

Principal transactions revenue decreased compared with the stronger results in the three months ended March 31, 2013, reflecting, in CIB, lower fixed income markets revenue on weaker performance across most products and lower levels of client activity, as well as lower equity markets revenue on lower derivatives revenue. The decreases were partially offset by improved private equity results, reflecting net valuation gains on public and private investments, and gains from sales, compared with a net loss in the prior year. For additional information on principal transactions revenue, see CIB and Corporate/Private Equity

segment results on pages 28–31 and pages 37–38, respectively, and Note 6 on page 110 of this Form 10-Q.

Asset management, administration and commissions revenue increased in the three months ended March 31, 2014 compared with the prior year, reflecting higher net client inflows and the effect of higher market levels in AM and CCB. For additional information on these fees and commissions, see the segment discussions for CCB on pages 19–27, AM on pages 34–36, and Note 6 on page 110 of this Form 10-Q.

Securities gains in the three months ended March 31, 2014 decreased compared with the prior year, reflecting the repositioning of the investment securities portfolio in the prior year. For additional information, see the Corporate/Private Equity segment discussion on pages 37–38, and Note 11 on pages 113–116 of this Form 10-Q.

Mortgage fees and related income decreased compared with the three months ended March 31, 2013. The decrease resulted from lower Mortgage Banking (“MB”) net production and servicing revenue. The decrease in net production revenue was largely due to lower volumes. The decrease in net servicing revenue was predominantly due to lower mortgage servicing rights (“MSR”) risk management results, which included a negative $460 million fair value adjustment primarily related to higher capital allocated to the business. For additional information, see pages 23–24, and Note 16 on pages 148–151 of this Form 10-Q.

Other income decreased in the three months ended March 31, 2014 compared with the prior year, largely due to lower valuations of seed capital investments in AM.

Net interest income decreased in the three months ended March 31, 2014, compared with the prior year, reflecting the impact of lower loan yields due to run-off of higher yielding loans and originations of lower yielding loans, and lower average trading asset balances; predominantly offset by higher investment securities yields, and lower long-term debt and deposit interest expense. The aforementioned lower long-term debt and deposit interest expense were, in each case, driven by lower yields, partly offset by higher average balances. The Firm’s average interest-earning assets were $2.0 trillion for the three months ended March 31, 2014, and the net interest yield on those assets, on a fully taxable-equivalent (“FTE”) basis, was 2.20%, a decrease of 17 basis points from the prior year.

Provision for credit losses

Three months ended March 31,

(in millions)

2014

2013

Change

Consumer, excluding credit card

$

119

$

(37

)

NM

Credit card

688

582

18

%

Total consumer

807

545

48

Wholesale

43

72

(40

)

Total provision for credit losses

$

850

$

617

38

%

10

The provision for credit losses increased from the three months ended March 31, 2013, reflecting a $449 million reduction in the consumer allowance for loan losses, compared with a $1.1 billion reduction in the prior year. The current-quarter consumer allowance release was primarily due to the impact of improved home prices and delinquency trends in the residential real estate portfolio, as well as a reduction in the credit card asset-specific allowance due to increased granularity of impairment estimates for loans modified in TDRs. The lower reduction in consumer allowance was largely offset by lower consumer net charge-offs. The wholesale provision for credit losses remained relatively flat, reflecting a generally favorable credit environment and stable credit quality trends. For a more detailed discussion of the credit portfolio and the allowance for credit losses, see the segment discussions for CCB on pages 19–27, CIB on pages 28–31 and CB on pages 32–33, and the Allowance for credit losses section on pages 54–56 of this Form 10-Q.

Noninterest expense

Three months ended March 31,

(in millions)

2014

2013

Change

Compensation expense

$

7,859

$

8,414

(7

)%

Noncompensation expense:

Occupancy

952

901

6

Technology, communications and equipment

1,411

1,332

6

Professional and outside services

1,786

1,734

3

Marketing

564

589

(4

)

Other expense(a)(b)

1,933

2,301

(16

)

Amortization of intangibles

131

152

(14

)

Total noncompensation expense

6,777

7,009

(3

)

Total noninterest expense

$

14,636

$

15,423

(5

)%

(a)

Included firmwide legal expense of $347 million for the three months ended March 31, 2013; legal expense for the three months ended March 31, 2014 was not material.

(b)

Included FDIC-related expense of $293 million and $379 million for the three months ended March 31, 2014 and 2013, respectively.

Total noninterest expense for the three months ended March 31, 2014, was $14.6 billion, down by $787 million, or 5%, compared with the prior year. The decrease from the prior year was driven by lower compensation and other expense.

Compensation expense decreased in the three months ended March 31, 2014, compared with the prior year, predominantly driven by lower performance-based compensation expense in CIB, as well as lower headcount-related expense in MB. The decrease in compensation expense was partly offset by higher costs related to the additional headcount-related expense in connection with the Firm’s control agenda.

Noncompensation expense in the three months ended March 31, 2014, decreased compared with the prior year. The decrease was predominantly due to lower other expense, in particular, lower legal-related expense. Also contributing to the decrease were lower foreclosed asset

expense in MB and lower FDIC-related assessments. The decrease in noncompensation expense was partially offset by higher costs related to the Firm’s control agenda. For a further discussion of legal expense, see Note 23 on pages 159–165 of this Form 10-Q.

Income tax expense

(in millions, except rate)

Three months ended March 31,

2014

2013

Change

Income before income tax expense

$

7,507

$

9,082

(17

)%

Income tax expense

2,233

2,553

(13

)

Effective tax rate

29.7

%

28.1

%

The increase in the effective tax rate compared with the prior year was largely attributable to the write-down of deferred tax assets impacted by tax law changes enacted by New York State; the prior year included tax benefits associated with tax adjustments and the settlement of tax audits. The increase in the effective tax rate was partially offset by the impact of lower reported pretax income in 2014 in combination with changes in the mix of income and expenses subject to U.S. federal and state and local taxes. For additional information on income taxes, see Critical Accounting Estimates Used by the Firm on pages 76–78, of this Form 10-Q.

11

BALANCE SHEET ANALYSIS

Selected Consolidated Balance Sheets data

(in millions)

March 31, 2014

December 31, 2013

Change

Assets

Cash and due from banks

$

26,321

$

39,771

(34

)%

Deposits with banks

372,531

316,051

18

Federal funds sold and securities purchased under resale agreements

265,168

248,116

7

Securities borrowed

122,021

111,465

9

Trading assets:

Debt and equity instruments

315,932

308,905

2

Derivative receivables

59,272

65,759

(10

)

Securities

351,850

354,003

(1

)

Loans

730,971

738,418

(1

)

Allowance for loan losses

(15,847

)

(16,264

)

(3

)

Loans, net of allowance for loan losses

715,124

722,154

(1

)

Accrued interest and accounts receivable

73,122

65,160

12

Premises and equipment

14,919

14,891

—

Goodwill

48,065

48,081

—

Mortgage servicing rights

8,552

9,614

(11

)

Other intangible assets

1,489

1,618

(8

)

Other assets

102,620

110,101

(7

)

Total assets

$

2,476,986

$

2,415,689

3

Liabilities

Deposits

$

1,282,705

$

1,287,765

—

Federal funds purchased and securities loaned or sold under repurchase agreements

217,442

181,163

20

Commercial paper

60,825

57,848

5

Other borrowed funds

31,951

27,994

14

Trading liabilities:

Debt and equity instruments

91,471

80,430

14

Derivative payables

49,138

57,314

(14

)

Accounts payable and other liabilities

202,499

194,491

4

Beneficial interests issued by consolidated VIEs

46,788

49,617

(6

)

Long-term debt

274,512

267,889

2

Total liabilities

2,257,331

2,204,511

2

Stockholders’ equity

219,655

211,178

4

Total liabilities and stockholders’ equity

$

2,476,986

$

2,415,689

3

%

Consolidated Balance Sheets overview

JPMorgan Chase’s total assets increased by $61.3 billion or 3%, and total liabilities increased by $52.8 billion or 2%, from December 31, 2013.

The following is a discussion of the significant changes in the specific line item captions on the Consolidated Balance Sheets from December 31, 2013.

Cash and due from banks and deposits with banks

The net increase was attributable to excess funds, which the Firm placed with various central banks, predominantly Federal Reserve Banks. For additional information, refer to the Liquidity Risk Management discussion on pages 71–75 of this Form 10-Q.

Federal funds sold and securities purchased under resale agreements; and securities borrowed

The increase was attributable to higher securities purchased under resale agreements and securities borrowed due to higher requirement for collateral to cover client-driven

activities in CIB.

Trading assets and liabilities–debt and equity instruments

The increase in trading assets was related to client-driven market-making activities in CIB, which resulted in higher levels of debt securities, partially offset by a lower level of physical commodities.

The increase in trading liabilities was attributable to client-driven market-making activities in CIB, which resulted in higher levels of client-driven short positions in debt and equity securities. For additional information, refer to Note 3 on pages 86–97 of this Form 10-Q.

Trading assets and liabilities–derivative receivables and payables

The decrease in both receivables and payables was due to additional netting of equity derivatives balances following the receipt of appropriate legal opinions with respect to additional master netting agreements; client-driven market-making activity; and reductions in foreign exchange derivatives driven by maturities. For additional information, refer to Derivative contracts on pages 52–53, and Notes 3 and 5 on pages 86–97 and pages 100–109, respectively, of this Form 10-Q.

Securities

The decrease was largely due to lower levels of non-U.S. residential mortgage-backed securities, partly offset by higher levels of U.S. mortgage-backed securities and obligations of U.S. states and municipalities. For additional information related to securities, refer to the discussion in the Corporate/Private Equity segment on pages 37–38, and Notes 3 and 11 on pages 86–97 and pages 113–116, respectively, of this Form 10-Q.

Loans and allowance for loan losses

The decrease was predominantly due to lower consumer loans, reflecting seasonality and higher repayment rates in the credit card portfolio; and paydowns and the charge-off or liquidation of delinquent loans in the consumer, excluding credit card portfolio.

12

The decrease in allowance for loan losses was driven by a reduction in the consumer allowance of $449 million, predominantly as a result of improved home prices and delinquency trends on the residential real estate portfolio, a reduction in the credit card asset-specific allowance due to increased granularity of impairment estimates for loans modified in TDRs, as well as run-off in the student loan portfolio. The wholesale allowance was relatively unchanged, reflecting a generally favorable credit environment and stable credit quality trends. For a more detailed discussion of the loan portfolio and the allowance for loan losses, refer to Credit Risk Management on pages 40–56, and Notes 3, 4, 13 and 14 on pages 86–97, pages 98–99, pages 119–139 and page 140, respectively, of this Form 10-Q.

Accrued interest and accounts receivable

The increase was largely due to higher receivables from security sales that did not settle and higher dividend receivables in CIB.

Mortgage servicing rights

The decrease was due to a fair value adjustment primarily related to higher capital allocated to the Mortgage Banking business, the impact of changes in market interest rates, collection/realization of expected cash flows, and dispositions, partially offset by originations. For additional information on MSRs, see Note 16 on pages 148–151 of this Form 10-Q.

Deposits

The decrease was driven by lower wholesale deposits, largely offset by higher consumer deposits. The decline in wholesale deposits was related to the normalization of deposit levels from year-end seasonal inflows. The increase in consumer deposits reflected the continuing positive growth trend, which was the result of strong customer retention and deeper account relationships, driven by improved customer satisfaction levels, the maturing of recent branch builds, and net new business. For more information on consumer deposits, refer to the CCB segment discussion on pages 19–27 ; the Liquidity Risk Management discussion on pages 71–75; and Notes 3 and 17 on pages 86–97 and page 152, respectively, of this Form 10-Q. For more information on wholesale client deposits, refer to the AM, CB and CIB segment discussions on pages 34–36, pages 32–33 and pages 28–31, respectively, of this Form 10-Q.

Federal funds purchased and securities loaned or sold under repurchase agreements

The increase in securities sold under repurchase agreements was predominantly due to higher financing of the Firm’s trading assets-debt and equity instruments, and a change in the mix of the Firm’s funding sources. For additional information on the Firm’s Liquidity Risk Management, see pages 71–75 of this Form 10-Q.

Accounts payable and other liabilities

The increase was attributable to higher brokerage payables, higher payables from security purchases that did not settle, and client short positions in CIB, partly offset by a decline in other liabilities in Corporate/Private Equity, largely reflecting settlements of certain legal and regulatory matters.

Long-term debt

The increase was due to net issuances. For additional information on the Firm’s long-term debt activities, see the Liquidity Risk Management discussion on pages 71–75 of this Form 10-Q.

Stockholders’ equity

The increase was due to net income; preferred stock issuances in the first quarter of 2014; and higher accumulated other comprehensive income, primarily related to higher market valuations of obligations of U.S. states and municipalities. The increase was partially offset by the declaration of cash dividends on common and preferred stock. For additional information on the Firm’s capital actions, see Capital actions on page 69 of this Form 10-Q.

13

OFF-BALANCE SHEET ARRANGEMENTS

JPMorgan Chase is involved with several types of off–balance sheet arrangements, including through nonconsolidated special-purpose entities (“SPEs”), which are a type of variable interest entity (“VIE”), and through lending-related financial instruments (e.g., commitments and guarantees). For further discussion, see Note 21 on pages 155–158 of this Form 10-Q, Off–Balance Sheet Arrangements and Contractual Cash Obligations on pages 77–79 and Note 29 on pages 318–324 of JPMorgan Chase’s 2013Annual Report.

Special-purpose entities

The most common type of VIE is an SPE. SPEs are commonly used in securitization transactions in order to isolate certain assets and distribute the cash flows from those assets to investors. SPEs are an important part of the financial markets, including the mortgage- and asset-backed securities and commercial paper markets, as they provide market liquidity by facilitating investors’ access to specific portfolios of assets and risks. The Firm holds capital, as deemed appropriate, against all SPE-related transactions and related exposures, such as derivative transactions and lending-related commitments and guarantees. For further information on the types of SPEs, see Note 15 on pages 141–147 of this Form 10-Q, and Note 1 on pages 189–191 and Note 16 on pages 288–299 of JPMorgan Chase’s 2013Annual Report.

For certain liquidity commitments to SPEs, JPMorgan Chase Bank, N.A., could be required to provide funding if its short-term credit rating were downgraded below specific levels, primarily “P-1,” “A-1” and “F1” for Moody’s, Standard & Poor’s and Fitch, respectively. These liquidity commitments support the issuance of asset-backed commercial paper by Firm-administered consolidated SPEs. In prior periods JPMorgan Chase Bank, N.A. also provided liquidity commitments to third-party sponsored unconsolidated SPEs. In the event of a short-term credit rating downgrade, JPMorgan Chase Bank, N.A., absent other solutions, would be required to provide funding to the SPE, if the commercial paper could not be reissued as it matured. The aggregate amounts of commercial paper outstanding held by third parties as of March 31, 2014, and December 31, 2013, was $12.0 billion and $15.5 billion, respectively. The aggregate amounts of commercial paper outstanding could increase in future periods should clients of the Firm-administered consolidated SPEs draw down on certain unfunded lending-related commitments. These unfunded lending-related commitments were $10.3 billion and $9.2 billion at March 31, 2014, and December 31, 2013, respectively. The Firm could facilitate the refinancing of some of the clients’ assets in order to reduce the funding obligation.

JPMorgan Chase provides lending-related financial instruments (e.g., commitments and guarantees) to meet the financing needs of its customers. The contractual amount of these financial instruments represents the maximum possible credit risk to the Firm should the counterparty draw upon the commitment or the Firm be required to fulfill its obligation under the guarantee, and should the counterparty subsequently fail to perform according to the terms of the contract. Most of these commitments and guarantees expire without being drawn or a default occurring. As a result, the total contractual amount of these instruments is not, in the Firm’s view, representative of its actual future credit exposure or funding requirements. For further discussion of lending-related financial instruments, guarantees and other commitments, and the Firm’s accounting for them, see Lending-related commitments on page 52 and Note 21 (including the table that presents the related amounts by contractual maturity as of March 31, 2014) on pages 155–158 of this Form 10-Q. For a discussion of loan repurchase liabilities, see Note 21 on pages 155–158 of this Form 10-Q.

14

CASH FLOWS ANALYSIS

For a discussion of the activities affecting the Firm’s cash flows, see pages 80–81 of JPMorgan Chase’s 2013 Annual Report and Balance Sheet Analysis on pages 12–13 of this Form 10-Q.

(in millions)

Three months ended March 31,

2014

2013

Net cash provided by (used in)

Operating activities

$

14,667

$

19,964

Investing activities

(68,410

)

(55,455

)

Financing activities

40,318

28,180

Effect of exchange rate changes on Cash

(25

)

(888

)

Net increase (decrease) in cash and due from banks

$

(13,450

)

$

(8,199

)

Operating Activities

Operating assets and liabilities can vary significantly in the normal course of business due to the amount and timing of cash flows, which are affected by client-driven and risk management activities, and market conditions. The Firm believes cash flows from operations, available cash balances and its ability to generate cash through short- and long-term borrowings are sufficient to fund the Firms’ operating liquidity needs.

Cash provided by operating activities during 2014 predominantly resulted from a decrease in other assets largely driven by lower cash margin balances placed with exchanges and clearing houses and higher proceeds from sales and paydowns of loans in excess of the cash used to originate and purchase loans the Firm initially intended to sell. Cash provided for 2013 predominantly resulted from lower trading assets driven by client-driven market-making activity in CIB, partially offset by an increase in accounts receivables due to higher margin loan balances driven by client activities predominantly in CIB; and the timing of merchant receivables payments related to CCB’s card business.

Investing Activities

Cash used in investing activities during 2014 and 2013 predominantly resulted from increases in deposits with banks reflecting the placement of the Firm’s excess funds with various central banks, predominantly Federal Reserve banks. Cash outflows in 2014 predominantly resulted from higher securities purchased under resale agreements due to increased requirements for collateral to cover trading activities in CIB. Partially offsetting cash outflows in 2013 was a decline in securities purchased due to a shift in the deployment of the Firm’s excess cash by Treasury.

Financing Activities

Cash provided by financing activities in 2014 predominantly resulted from an increase in securities loaned or sold under repurchase agreements due to higher financing of the Firm’s trading assets–debt and equity instruments and a change in the mix of the Firm’s funding sources, as well as from proceeds from the issuance of preferred stock. Cash provided in 2013 was predominantly driven by net proceeds from long-term borrowings and an increase in securities loaned or sold under repurchase agreements predominantly due to higher secured financing of the Firm’s assets and higher client financing activity.

15

EXPLANATION AND RECONCILIATION OF THE FIRM’S USE OF NON-GAAP FINANCIAL MEASURES

The Firm prepares its consolidated financial statements using accounting principles generally accepted in the U.S. (“U.S. GAAP”); these financial statements appear on pages 80–84 of this Form 10-Q. That presentation, which is referred to as “reported” basis, provides the reader with an understanding of the Firm’s results that can be tracked consistently from year-to-year and enables a comparison of the Firm’s performance with other companies’ U.S. GAAP financial statements.

In addition to analyzing the Firm’s results on a reported basis, management reviews the Firm’s results and the results of the lines of business on a “managed” basis, which is a non-GAAP financial measure. The Firm’s definition of managed basis starts with the reported U.S. GAAP results and includes certain reclassifications to present total net revenue for the Firm (and each of the business segments) on a FTE basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in

the managed results on a basis comparable to taxable investments and securities. This non-GAAP financial measure allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The corresponding income tax impact related to tax-exempt items is recorded within income tax expense. These adjustments have no impact on net income as reported by the Firm as a whole or by the lines of business.

Management also uses certain non-GAAP financial measures at the business-segment level, because it believes these other non-GAAP financial measures provide information to investors about the underlying operational performance and trends of the particular business segment and, therefore, facilitate a comparison of the business segment with the performance of its competitors. Non-GAAP financial measures used by the Firm may not be comparable to similarly named non-GAAP financial measures used by other companies.

The following summary table provides a reconciliation from the Firm’s reported U.S. GAAP results to managed basis.

Three months ended March 31,

2014

2013

(in millions, except ratios)

Reported

results

Fully taxable-equivalent adjustments(a)

Managed

basis

Reported

results

Fully taxable-equivalent adjustments(a)

Managed

basis

Other income

$

391

$

644

$

1,035

$

536

$

564

$

1,100

Total noninterest revenue

12,326

644

12,970

14,189

564

14,753

Net interest income

10,667

226

10,893

10,933

162

11,095

Total net revenue

22,993

870

23,863

25,122

726

25,848

Pre-provision profit

8,357

870

9,227

9,699

726

10,425

Income before income tax expense

7,507

870

8,377

9,082

726

9,808

Income tax expense

$

2,233

$

870

$

3,103

$

2,553

$

726

$

3,279

Overhead ratio

64

%

NM

61

%

61

%

NM

60

%

(a)

Predominantly recognized in CIB and CB business segments and Corporate/Private Equity.

Tangible common equity (“TCE”), ROTCE and TBVPS are each non-GAAP financial measures. TCE represents the Firm’s common stockholders’ equity (i.e., total stockholders’ equity less preferred stock) less goodwill and identifiable intangible assets (other than MSRs), net of related deferred tax liabilities. ROTCE measures the Firm’s earnings as a percentage of average TCE. TBVPS represents the Firm’s tangible common equity divided by period-end common shares. TCE, ROTCE, and TBVPS are meaningful to the Firm, as well as investors and analysts, in assessing the Firm’s use of equity.

Average tangible common equity

(in millions, except per share

and ratio data)

Three months ended March 31,

2014

2013

Common stockholders’ equity

$

201,797

$

194,733

Less: Goodwill

48,054

48,168

Less: Certain identifiable intangible assets

1,548

2,162

Add: Deferred tax liabilities(a)

2,944

2,828

Tangible common equity

$

155,139

$

147,231

Return on tangible common equity (“ROTCE”)

13

%

17

%

Tangible book value per share

$

41.73

$

39.54

(a)

Represents deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in non-taxable transactions, which are netted against goodwill and other intangibles when calculating TCE.

16

Additionally, certain capital ratios disclosed by the Firm are non-GAAP measures. For additional information on these non-GAAP measures, see Regulatory capital on pages 63–68 of this Form 10-Q.

Core net interest income

In addition to reviewing net interest income on a managed basis, management also reviews core net interest income to assess the performance of its core lending, investing (including asset-liability management) and deposit-raising activities. Core net interest income excludes the impact of CIB’s market-based activities. Because of the exclusion of CIB’s market-based net interest income and the related assets, the core data presented below are non-GAAP financial measures. Management believes this data provides investors and analysts a more meaningful measure by which to analyze the non-market-related business trends of the Firm and provides a comparable measure to other financial institutions that are primarily focused on core lending, investing and deposit-raising activities.

Core net interest income data(a)

Three months ended March 31,

(in millions, except rates)

2014

2013

Change

Net interest income – managed basis(b)(c)

$

10,893

$

11,095

(2

)%

Less: Market-based net interest income

1,056

1,432

(26

)

Core net interest income(b)

$

9,837

$

9,663

2

Average interest-earning assets

$

2,005,646

$

1,896,084

6

Less: Average market-based earning assets

507,499

508,941

—

Core average interest-earning assets

$

1,498,147

$

1,387,143

8

%

Net interest yield on interest-earning assets – managed basis

2.20

%

2.37

%

Net interest yield on market-basedactivities

0.84

1.14

Core net interest yield on core average interest-earning assets

2.66

%

2.83

%

(a)

Includes core lending, investing and deposit-raising activities on a managed basis across each of the business segments and Corporate/Private Equity; excludes the market-based activities within the CIB.

(b)

Interest includes the effect of related hedging derivatives. Taxable-equivalent amounts are used where applicable.

(c)

For a reconciliation of net interest income on a reported and managed basis, see reconciliation from the Firm’s reported U.S. GAAP results to managed basis on page 16 of this Form 10-Q.

Quarterly results

Core net interest income increased by $174 million to $9.8 billion for the three months endedMarch 31, 2014, compared with the prior year period and core average interest-earning assets increased by $111.0 billion to $1,498.1 billion for the three months endedMarch 31, 2014, compared with the prior year period. The increase in net interest income from the prior year primarily reflected the impact of higher investment securities yields, lower long-term debt and deposit expense, largely offset by lower loan yields due to run-off of higher yielding loans and

originations of lower yielding loans. The aforementioned lower long-term debt and deposit interest expense were, in each case, driven by lower yields, partly offset by higher average balances. The increase in average interest-earning assets primarily reflected the impact of higher average deposits with banks. For the three months endedMarch 31, 2014, core net interest yield decreased by 17 basis points to 2.66%, compared with the prior year period, primarily reflecting the impact of a significant increase in average deposits with banks and lower loan yields, partially offset by the impact of higher investment securities yields and lower long-term debt yields.

17

BUSINESS SEGMENT RESULTS

The Firm is managed on a line of business basis. There are four major reportable business segments – Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset Management. In addition, there is a Corporate/Private Equity segment.

The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by management. Results of these lines of business are presented on a managed basis. For a definition of managed basis, see Explanation and Reconciliation of the Firm’s use of non-GAAP financial measures, on pages 16–17 of this Form 10-Q.

Description of business segment reporting methodology

Results of the business segments are intended to reflect each segment as if it were essentially a stand-alone business. The management reporting process that derives business segment results allocates income and expense using market-based methodologies. The Firm continues to assess the assumptions, methodologies and reporting classifications used for segment reporting, and further refinements may be implemented in future periods.

For a further discussion of those methodologies, see Business Segment Results – Description of business segment reporting methodology on pages 84–85 of JPMorgan Chase’s 2013 Annual Report.

Business segment capital allocation changes

Each business segment is allocated capital by taking into consideration stand-alone peer comparisons, regulatory capital requirements (as estimated under Basel III Advanced Fully Phased-In) and economic risk measures. The amount of capital assigned to each business is referred to as equity. Effective January 1, 2014, the Firm revised the capital allocated to certain businesses. For further information about these capital changes, see Line of business equity on pages 68–69 of this Form 10-Q.

Segment Results – Managed Basis

The following table summarizes the business segment results for the periods indicated.

Three months ended March 31,

Total net revenue

Total Noninterest expense

Pre-provision profit/(loss)

(in millions)

2014

2013

Change

2014

2013

Change

2014

2013

Change

Consumer & Community Banking

$

10,460

$

11,615

(10

)%

$

6,437

$

6,790

(5

)%

$

4,023

$

4,825

(17

)%

Corporate & Investment Bank

8,606

10,140

(15

)

5,604

6,111

(8

)

3,002

4,029

(25

)

Commercial Banking

1,651

1,673

(1

)

686

644

7

965

1,029

(6

)

Asset Management

2,778

2,653

5

2,075

1,876

11

703

777

(10

)

Corporate/Private Equity

368

(233

)

NM

(166

)

2

NM

534

(235

)

NM

Total

$

23,863

$

25,848

(8

)%

$

14,636

$

15,423

(5

)%

$

9,227

$

10,425

(11

)%

Three months ended March 31,

Provision for credit losses

Net income/(loss)

Return on common equity

(in millions, except ratios)

2014

2013

Change

2014

2013

Change

2014

2013

Consumer & Community Banking

$

816

$

549

49

%

$

1,936

$

2,586

(25

)%

15

%

23

%

Corporate & Investment Bank

49

11

345

1,979

2,610

(24

)

13

19

Commercial Banking

5

39

(87

)

578

596

(3

)

17

18

Asset Management

(9

)

21

NM

441

487

(9

)

20

22

Corporate/Private Equity

(11

)

(3

)

(267

)

340

250

36

NM

NM

Total

$

850

$

617

38

%

$

5,274

$

6,529

(19

)%

10

%

13

%

18

CONSUMER & COMMUNITY BANKING

For a discussion of the business profile of CCB, see pages 86–97 of JPMorgan Chase’s 2013 Annual Report and the Introduction on page 4 of this Form 10-Q.

Selected income statement data

Three months ended March 31,

(in millions, except ratios)

2014

2013

Change

Revenue

Lending- and deposit-related fees

$

703

$

723

(3

)%

Asset management, administration and commissions

503

533

(6

)

Mortgage fees and related income

514

1,450

(65

)

Card income

1,348

1,362

(1

)

All other income

366

338

8

Noninterest revenue

3,434

4,406

(22

)

Net interest income

7,026

7,209

(3

)

Total net revenue

10,460

11,615

(10

)

Provision for credit losses

816

549

49

Noninterest expense

Compensation expense

2,739

3,006

(9

)

Noncompensation expense

3,604

3,676

(2

)

Amortization of intangibles

94

108

(13

)

Total noninterest expense

6,437

6,790

(5

)

Income before income tax expense

3,207

4,276

(25

)

Income tax expense

1,271

1,690

(25

)

Net income

$

1,936

$

2,586

(25

)%

Financial ratios

Return on common equity

15

%

23

%

Overhead ratio

62

58

Quarterly results

Consumer & Community Banking net income was $1.9 billion, a decrease of $650 million, or 25%, compared with the prior year, due to lower net revenue and higher provision for credit losses, partially offset by lower noninterest expense.

Net revenue was $10.5 billion, a decrease of $1.2 billion, or 10%, compared with the prior year. Net interest income was $7.0 billion, down $183 million, or 3%, driven by spread compression in Credit Card, Auto and Consumer & Business Banking, and by lower mortgage warehouse balances, largely offset by higher deposit balances. Noninterest revenue was $3.4 billion, a decrease of $972 million, or 22%, driven by lower mortgage fees and related income.

The provision for credit losses was $816 million, compared with $549 million in the prior year. The current-quarter provision reflected a $450 million reduction in the allowance for loan losses and total net charge-offs of $1.3 billion. The prior-year provision reflected a $1.2 billion reduction in the allowance for loan losses and total net

charge-offs of $1.7 billion. For more information, including net charge-off amounts and rates, see Consumer Credit Portfolio on pages 41–47 of this Form 10-Q.

Noninterest expense was $6.4 billion, a decrease of $353 million, or 5%, from the prior year, driven by lower Mortgage Banking expense.

Selected metrics

As of or for the three months ended March 31,

(in millions, except headcount)

2014

2013

Change

Selected balance sheet data (period-end)

Total assets

$

441,502

$

458,902

(4

)%

Loans:

Loans retained

386,314

393,575

(2

)

Loans held-for-sale and loans at fair value(a)

7,411

16,277

(54

)

Total loans

393,725

409,852

(4

)

Deposits

487,674

457,176

7

Equity(b)

51,000

46,000

11

Selected balance sheet data (average)

Total assets

$

450,424

$

463,527

(3

)

Loans:

Loans retained

388,678

397,118

(2

)

Loans held-for-sale and loans at fair value(a)

8,102

21,181

(62

)

Total loans

396,780

418,299

(5

)

Deposits

471,581

441,335

7

Equity(b)

51,000

46,000

11

Headcount

145,651

161,123

(10

)%

(a)

Predominantly consists of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets on the Consolidated Balance Sheets.

(b)

2014 includes $3.0 billion of capital held at the CCB level related to legacy mortgage servicing matters.

Net charge-offs and the net charge-off rate for the three months ended March 31, 2014 excluded $61 million of write-offs in the PCI portfolio. These write-offs decreased the allowance for loan losses for PCI loans. For further information, see Consumer Credit Portfolio on pages 120–129 of JPMorgan Chase’s 2013 Annual Report.

(b)

Excludes PCI loans. The Firm is recognizing interest income on each pool of PCI loans as they are all performing.

(c)

Certain mortgage loans originated with the intent to sell are classified as trading assets on the Consolidated Balance Sheets.

(d)

At March 31, 2014 and 2013, nonperforming assets excluded: (1) mortgage loans insured by U.S. government agencies of $7.7 billion and $10.9 billion, respectively, that are 90 or more days past due; (2) real estate owned insured by U.S. government agencies of $2.1 billion and $1.7 billion, respectively; and (3) student loans insured by U.S. government agencies under the Federal Family Education Loan Program (“FFELP”) of $387 million and $523 million, respectively, that are 90 or more days past due. These amounts have been excluded from nonaccrual loans based upon the government guarantee.

(e)

Loans held-for-sale and loans accounted for at fair value were excluded when calculating the net charge-off rate.

(f)

The allowance for loan losses for PCI loans was $4.1 billion and $5.7 billion at March 31, 2014 and 2013, respectively; these amounts were also excluded from the applicable ratios.

(g)

Includes Express Banking Kiosks (“EBK”). Prior periods were revised to conform with the current presentation.

Consumer & Business Banking

Selected financial statement data(a)

As of or for the three months ended March 31,

(in millions, except ratios)

2014

2013

Change

Revenue

Lending- and deposit-related fees

$

691

$

711

(3

)%

Asset management, administration and commissions

483

426

13

Card income

376

349

8

All other income

122

119

3

Noninterest revenue

1,672

1,605

4

Net interest income

2,708

2,572

5

Total net revenue

4,380

4,177

5

Provision for credit losses

76

61

25

Noninterest expense

3,065

3,041

1

Income before income tax expense

1,239

1,075

15

Net income

$

740

$

641

15

Return on common equity

27

%

24

%

Overhead ratio

70

73

Equity (period-end and average)

$

11,000

$

11,000

—

Quarterly results

Consumer & Business Banking net income was $740 million, an increase of $99 million, or 15%, compared with the prior year, due to higher net revenue, partially offset by higher noninterest expense and higher provision for credit losses.

Mortgage Banking net income was $114 million, a decrease of $559 million from the prior year, driven by lower net revenue and lower benefit from the provision for credit losses, partially offset by lower noninterest expense.

Net revenue was $1.6 billion, a decrease of $1.1 billion compared with the prior year. Net interest income was $1.1 billion, a decrease of $117 million, or 10%, driven by lower warehouse balances as well as lower loan balances due to portfolio runoff. Noninterest revenue was $511 million, a decrease of $1.0 billion, driven by lower mortgage fees and related income.

The provision for credit losses was a benefit of $23 million, compared with a benefit of $198 million in the prior year. The current quarter reflected a $200 million reduction in the allowance for loan losses, reflecting continued improvement in home prices and delinquencies. The prior year included a $650 million reduction in the allowance for loan losses. Net charge-offs were $177 million, compared with $452 million in the prior year.

Noninterest expense was $1.4 billion, a decrease of $403 million, or 22%, from the prior year, due to lower headcount-related expense in production and servicing.

21

Functional results

Three months ended March 31,

(in millions, except ratios)

2014

2013

Change

Mortgage Production

Production revenue

$

161

$

995

(84

)%

Production-related net interest & other income

131

223

(41

)

Production-related revenue, excluding repurchase (losses)/benefits

292

1,218

(76

)

Production expense(a)

478

710

(33

)

Income, excluding repurchase (losses)/benefits

(186

)

508

NM

Repurchase (losses)/benefits

128

(81

)

NM

Income/(loss) before income tax expense/(benefit)

(58

)

427

NM

Mortgage Servicing

Loan servicing revenue

870

936

(7

)

Servicing-related net interest & other income

88

100

(12

)

Servicing-related revenue

958

1,036

(8

)

Changes in MSR asset fair value due to collection/realization of expected cash flows

(245

)

(258

)

5

Default servicing expense

364

497

(27

)

Core servicing expense(a)

218

240

(9

)

Income, excluding MSR risk management

131

41

220

MSR risk management, including related net interest income/(expense)

(401

)

(142

)

(182

)

Income/(loss) before income tax expense/(benefit)

(270

)

(101

)

(167

)

Real Estate Portfolios

Noninterest revenue

(45

)

(17

)

(165

)

Net interest income

882

962

(8

)

Total net revenue

837

945

(11

)

Provision for credit losses

(26

)

(202

)

87

Noninterest expense

346

363

(5

)

Income before income tax expense

517

784

(34

)

Mortgage Banking income before income tax expense

$

189

$

1,110

(83

)

Mortgage Banking net income

$

114

$

673

(83

)%

Overhead ratios

Mortgage Production

113

%

62

%

Mortgage Servicing

186

116

Real Estate Portfolios

41

38

(a)

Includes provision for credit losses.

Selected income statement data

Three months ended March 31,

(in millions)

2014

2013

Change

Supplemental mortgage fees and related income details

Net production revenue:

Production revenue

$

161

$

995

(84

)%

Repurchase (losses)/benefits

128

(81

)

NM

Net production revenue

289

914

(68

)

Net mortgage servicing revenue:

Operating revenue:

Loan servicing revenue

870

936

(7

)

Changes in MSR asset fair value due to collection/realization of expected cash flows

(245

)

(258

)

5

Total operating revenue

625

678

(8

)

Risk management:

Changes in MSR asset fair value due to market interest rates and other(a)

(362

)

546

NM

Other changes in MSR asset fair value due to other inputs and assumptions in model(b)